When options arrive, your lease is no longer carved in stone.
Everything is open for negotiation.
And if you do negotiate, your landlord may be more motivated to listen.
But before making any decisions, you should consider:
- your company’s direction and any upcoming changes
- the building and landlord’s performance
- market comparisons: look at rental and incentives for nearby buildings
- how the fitout matches your current needs: is it time for a refresh?
Landlords are looking for commitment - but tenants are seeking flexibility.
A constantly changing business landscape, generational changes in working expectations and a growing trend in co-working setups are all factors behind these conditions.
We regularly advise clients on their “stay or go” strategy. Our consulting services can help you make the right decision and preserve your relationship with your landlord as these delicate and important negotiations take place.
Here at BRM Projects, we’ve recently guided three different clients successfully through the process, leading to three different outcomes. Each outcome, though, helped our clients re-align their lease with their overall company strategy.
The most recent move, four years ago, was to a great building but the existing fitout was becoming tired and outdated.
The Board, while generally happy with the Richmond location and a quality owner-occupier upstairs, realised an upgrade was necessary.
They also wanted flexibility as they pondered the direction of the company.
A long-term lease with landlord upgrades or shorter-term lease with no works was offered.
The short term option was taken, allowing Optalert to return to the market when the Board have shored up their strategy and direction.
Whilst still interested in further commitment to the existing space, Optalert now have flexibility until the direction of the company is clearer. In the meantime, the existing fitout will last until the end of term.
While happy with the location, they wanted to find competitive terms in the market from similar buildings.
Given their aim to remain in the premises long-term, we helped them align leases, join spaces together and use a fitout contribution, together with their own funding, to improve the fitout.
We continue to work with Roads Australia as they grow and seek additional space in the St Kilda Road precinct, ideally in the same building.
Since PRC is dependent on government funding for their pipeline of research and projects and current government policy in this area isn’t secure, flexibility was important.
Ten years later, they’re still happy with their location but we assisted them in negotiating a new term on their lease.
We looked at the market, negotiated with the landlord on their behalf, and suggested the removal of the “make good” clause. We negotiated an incentive which was then swapped for strategic removal of this clause (approximately the same value).
The outcome leaves Parenting Research Centre in control to consider relocation or an upgrade next term when they have a better idea of funding.
If your company has between 20 and 200 staff and you’re 12 months out from a lease renewal, it’s the perfect time to start forming a plan around renewal.
This timeframe allows for strategy investigation, search, lease, design, fitout, relocation and make good for an old space. If you end up staying and renewing the space, the early investigations are not lost.
You also won’t be forced to move at short notice if your landlord proves difficult during negotiations.
Let us help you get the best possible outcome, one which better aligns with your overall company strategy. Call us today on (03) 9521 1007.